The ultimate amount of that charge will depend in part upon alternatives available in other countries, which are currently under review and which may affect options granted from 1996 to 2003.
Over the next few years, the Company would expect to recoup $25 million in proceeds, not subject to income taxes, from these increases in option prices; but the increased proceeds would not flow through the income statement.
Thus, the real economic consequences of a $45 million after-tax charge would be significantly lower than the income statement consequences.
Jim Sinegal, President and Chief Executive Officer, stated: "We do not intend for our options-holding employees to be penalized for historical issues associated with some of our stock option grants, and this program is consistent with our corporate value of taking care of our employees."
Costco Wholesale Corporation
marketing@alchempro.com
